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Six of the 10 highest paid public servants in B.C., including one who makes $1.2 million, work for an agency many British Columbians have probably never heard of: the B.C. Investment Management Corporation.

Data from the latest version of The Vancouver Sun’s exclusive public-sector salary database reveals the six, who invest money on behalf of public-sector pension plans, got year-over-year raises in 2012 of at least 20 per cent each.

And while salary data for 2013 is not yet publicly available, the agency acknowledges the six probably received a similar bump in pay last year, too, because the investments they’ve made have been doing so well.

The corporation, which goes by the abbreviation bcIMC, invests money on behalf of the pension funds of more than 500,000 public-sector employees in B.C., a portfolio worth more than $100 billion. The bcIMC is based in Victoria and has 192 employees.

Doug Pearce, bcIMC’s CEO, has topped The Sun’s salary rankings several times during the past few years, usually with total pay around $1 million.

But in 2012, the most recent year for which data is available, Pearce made $1.2 million, a 23 per cent raise compared with his pay the year before.

For the last two years, Pearce was joined on the Top 10 list by just one of his colleagues: bcIMC vice-president Lincoln Webb.

Webb made the list again this year, with pay of $823,153, a 21 per cent increase from the year before.

And increases of 20 per cent or more meant four other bcIMC vice-presidents joined the Top 10 list this year, too: Bryan Thomson at $662,102, Paul Flanagan at $621 616, Dean Atkins at $609,687 and Daryl Jones at $564,552.

Rick Mahler, the chairman of bc-IMC’s board, defended the high salaries and big raises, saying they simply reflect the impressive returns that bcIMC has been able to achieve the last few years.

Mahler said compensation for bc-IMC’s senior staff is largely performance based: how much they’re paid is based on how well their investments do compared with a relevant benchmark like a stock-market index.

The investment corporation calculates those bonuses based on a four-year rolling average. Because of how badly the world’s stock markets performed in 2008 and 2009, said Mahler, bcIMC’s performance pay has been modest the past few years.

But as the markets improved — and the worst years started dropping off the four-year average — performance pay has shot up.

Mahler said bcIMC’s board made some changes to its bonus structure in 2012, which entitled senior staff to earn more money than they did before. But he said the biggest reason for the increased pay is simply that the agency’s investments have been doing so well, with an annual increase last year of close to 10 per cent.

“They’re paid on performance and, in 2012, they added … $1.5 billion of added value over what the market did,” said Mahler. “Paying someone a couple hundred thousand dollars for bringing in $1.5 billion, that’s a pretty good trade-off.”

Mahler said while bcIMC’s top salaries may seem high, they’re low compared with similar public-sector pension funds in Canada. “Of the top seven pension funds in Canada, we’re the fourth largest (by assets) and our compensation is the lowest … by a significant amount,” he said.

For example, Michael Nobrega, the CEO of Ontario’s municipal pension plan, which manages $60 billion in assets, earned $3.5 million in 2012.

Mahler also said that when bcIMC outperforms the market, that translates into a direct benefit to B.C.’s public-sector workers, who don’t have to contribute as much to their pensions to keep the funds healthy.

“Our clients are doing cartwheels,” he said.

The budget for bcIMC is paid out of an annual management fee charged to the pension funds it works for. That fee works out to about 20 cents for every $100 it manages, a fraction of the one or two dollars charged by some mutual fund companies.

Jones retired from bcIMC last year. Pearce has announced he plans to retire from bcIMC sometime this year once his replacement can be found.

Aside from the six bcIMC employees, the Top 10 list also includes three top traders at Powerex, the energy-trading arm of BC Hydro: Thomas Bechard, Mark Holman and Robert Campbell.

All three made between $930,000 and $985,000 in the 2012/13 fiscal year, roughly the same as the year before.

Powerex, which has 185 employees, buys and sells energy to ensure B.C. has a reliable supply of electricity.

But it also tries to profit from those trades, profits that Hydro argues help keep electricity rates low and contribute to government revenues.

Since 2003, according to Hydro, Powerex has generated more than $1.6 billion in income for the utility.

In 2010, Powerex significantly increased the pay of its top traders after U.S. financial firm Morgan Stanley tried to raid some of them away.

The final name on the Top 10 list is B.C. Securities Commission CEO Doug Hyndman, who earned $540,456 in the 2012/13 fiscal year. Hyndman is currently seconded to the Canadian Securities Transition Office, which is working on creating a national securities regulator.

Beyond the Top 10, four other public servants in B.C. made more than half a million dollars: University of B.C. president Stephen Toope at $533,445, Metro Vancouver planning manager Toivo Allas at $522,567, UBC dean of medicine Gavin Stuart at $513,905 and BC Cancer Agency oncologist Heidi Martins at $501,020.

Both Allas and Martins made the list due to large, one-time payouts they received when they retired.

While bcIMC and Powerex dominate the Top 10 list, the picture is quite different if you look at the Top 100 highest-paid public servants, a group you have to make at least $370,000 to be part of. Of those Top 100, 41 work at the Provincial Health Services Authority, which is responsible for provincial health agencies like B.C. Children’s Hospital and the BC Cancer Agency. The bcIMC is a distant second at 14, with Powerex and UBC tied for third at 13.

PHSA says that, because of the types of facilities it runs, it needs to employ more specialist physicians than other health authorities and has to pay them a competitive wage to attract and retain them.

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The half-million dollar club: See who ranks on the public sector's highest-paid list

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